Broadcom’s 1.23% Surge Driven by $10B AI Order Ranks Sixth in Market Activity as AI Revenue Jumps 63% to $5.2B

On September 4, 2025, Broadcom (AVGO) closed with a 1.23% gain, trading at a volume of $9.59 billion—a 71.72% surge from the prior day—ranking sixth in market activity. The stock’s performance was driven by a $10 billion order for custom AI chips from a new client, announced by CEO Hock Tan during the earnings call. This client, characterized as a “qualified customer,” has spurred a revised revenue forecast for 2026, with Tan emphasizing strong shipment momentum beginning next year.

The company’s third-quarter results exceeded expectations, reporting $15.96 billion in revenue (up 22% year-over-year) and $1.69 adjusted earnings per share. AI revenue surged 63% to $5.2 billion, outpacing internal guidance, while semiconductor solutions revenue rose 57% to $9.17 billion. Tan attributed the growth to custom AI accelerators, networking components, and VMware software, with AI revenue projected to reach $6.2 billion in the current quarter.

Investor optimism centers on Broadcom’s ability to challenge Nvidia’s AI chip dominance, as Tan disclosed ongoing development of new AI chips with three large cloud customers. The company’s infrastructure software division, including VMware, also grew 43% to $6.79 billion, reflecting broader demand for data center integration solutions. Despite a 32% annualized stock gain, analysts highlight elevated expectations, with Tan cautioning that 2026 growth will require sustained demand for custom silicon and hyperscaler partnerships.

Backtest results indicate the stock’s 1.23% rise aligns with its 32% annual performance, with $10 billion in AI orders and revised revenue forecasts serving as key catalysts. The $15.96 billion quarterly revenue and $4.14 billion net income (versus a prior-year loss) underscore improved profitability, driven by AI and cloud infrastructure momentum.